The Dax held its ground on Wednesday before the US Federal Reserve’s interest rate decision. At the close of trading, the leading German index was 0.14 percent above the previous day’s level at 15,216.19 points. The MDax, on the other hand, fell by 0.57 percent to 26,864.77 points. After the recent banking turbulence, economists expect the US Federal Reserve to raise interest rates slightly by 0.25 percentage points.
The other European stock exchanges did not make any big jumps in the middle of the week either: the EuroStoxx 50, the leading index in the euro zone, ended 0.3 percent higher. France’s Cac 40 was up 0.3 percent and Britain’s FTSE 100 was up 0.4 percent. In New York, the Dow Jones Industrial lost around 0.3 percent at the end of European trading.
Although Fed Chairman Jerome Powell had signaled a more restrictive monetary policy some time ago, more restraint is expected in view of the recent banking turmoil. Instead of a stronger interest rate hike, economists now expected a small increase of 0.25 percentage points.
Banking stocks came under selling pressure across Europe. After the shock of the emergency takeover of Credit Suisse by UBS at the weekend, the European banking index fell to its lowest level since November. Shares in Commerzbank and Deutsche Bank each fell more than 2 percent on Wednesday.
On the company side, it was mainly analyst studies that moved people. Shares in the chemical companies Covestro and BASF were in demand in the Dax with premiums of 2.0 and 0.8 percent.
On the other hand, real estate groups, which are burdened by high interest rates, were once again in the negative spotlight. Here it went down as a result of a pessimistic stance by the US investment bank Morgan Stanley on continental European stocks. According to analyst Bart Gysens, the risk of capital increases becoming necessary is generally increasing. Vonovia downgraded Gysens to “Underweight”. With a discount of 4.6 percent, the shares marked another low since 2014.
Zalando’s shares rose by 2.2 percent after a positive recommendation from the investment bank Exane BNP as a Dax leader. Deutsche Bank issued a buy recommendation for the forklift manufacturer Kion, which caused the price at the top of the MDax to rise by 3.9 percent.
The euro last cost 1.0793 US dollars. The European Central Bank (ECB) had set the reference rate at $1.0785 in the afternoon.
In the bond market, the Rex bond index fell 0.14 percent to 125.78 points, while the current yield rose to 2.33 percent from 2.23 percent the previous day. The Bund future recently fell by 0.24 percent to 135.56 points.
